A recent MarketWatch article discusses one of the biggest obstacles that people encounter when dealing with the long term care of a loved one, specifically a parent. Understanding their financial standing and what types of savings they have will better help you address their needs for care, but this is often not an easy task.
Preparing for the Cost
Adult children experiencing a long term care situation with parents who have been rendered disabled, ill, or in need of custodial care may run into some financial roadblocks along the way. The cost of care alone is enough to cause some major issues if your parents have not adequately planned a way to pay for care. Medicare does not cover the cost of long term care, a fact that many people are unaware of until the time comes, and the cost of care ranges from around $40,000 annually for in-home care to more than $90,000 for a private room in a nursing home.
When a situation like this arises, be it a bad fall or the diagnosis of dementia, managing the details of care can become the responsibility of the adult child. If both parents need care, this becomes even more likely. A medical emergency that requires long term care often brings about a great deal of financial and emotional stress for the entire family.
Jody Gastfriend, vice president of senior care services for Care.com, was quoted in the article saying, “It doesn’t matter how many degrees you have after your name, people who are hit with this are brought to their knees.”
Discussing these issues before a crisis arises rather than after is extremely important. Waiting to bring up this topic until a medical emergency has arisen will only add to the already rampant stress. Knowing what kinds of resources they have and how to access them ahead of time will take the worries away and relieve some of the difficulties that adult children face when dealing with their aging parents’ care.
Another crucial part is factoring your own finances out of the equation. You may want to help and think you can afford to, but if 10 years down the road, the same thing happened to you, would you still have enough to cover the costs? If possible, it’s best to avoid paying for your parents’ care in order to save your own retirement plans from collapsing.
Many adult children have considered this scenario and have opted to purchase a long term care insurance policy for their aging parents. If they are still in relatively good health, this is a viable option that can help both you and your parents avoid paying the full out-of-pocket cost of care, which can be devastating to any retirement portfolio. While you are at it, it is worth taking a
look at the options available for yourself, as well, especially if you have a family
history of chronic illness or dementia.
Long Term Care
A long term care insurance policy can provide benefits that help you avoid much of the complication involved in arranging care. Most good policies include a benefit called Care Coordination, which provides a designated Care Coordinator to assist the claimant and family along the way. The Care Coordinator will help you identify and assess your needs, create a plan of care, arrange for care, and even monitor the delivery of care in some cases. This can provide an invaluable service to families who are caught in the chaos of long term care and aren’t sure what to do.
Sitting down and talking to your parents about their finances ahead of time will make things easier in the future, should anything ever happen. Read more about the benefits included in long term care insurance policies or if you are interested in learning more about policies, request more information today and receive a free personalized comparison of the top companies.